Correlation Between PT Bank and FedEx
Can any of the company-specific risk be diversified away by investing in both PT Bank and FedEx at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining PT Bank and FedEx into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Bank Maybank and FedEx, you can compare the effects of market volatilities on PT Bank and FedEx and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in PT Bank with a short position of FedEx. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and FedEx.
Diversification Opportunities for PT Bank and FedEx
Very good diversification
The 3 months correlation between BOZA and FedEx is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Maybank and FedEx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FedEx and PT Bank is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on PT Bank Maybank are associated (or correlated) with FedEx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FedEx has no effect on the direction of PT Bank i.e., PT Bank and FedEx go up and down completely randomly.
Pair Corralation between PT Bank and FedEx
Assuming the 90 days trading horizon PT Bank Maybank is expected to generate 2.08 times more return on investment than FedEx. However, PT Bank is 2.08 times more volatile than FedEx. It trades about 0.02 of its potential returns per unit of risk. FedEx is currently generating about 0.02 per unit of risk. If you would invest 1.35 in PT Bank Maybank on September 14, 2024 and sell it today you would lose (0.10) from holding PT Bank Maybank or give up 7.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Bank Maybank vs. FedEx
Performance |
| Timeline |
| PT Bank Maybank |
| FedEx |
PT Bank and FedEx Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and FedEx
The main advantage of trading using opposite PT Bank and FedEx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, FedEx can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in FedEx will offset losses from the drop in FedEx's long position.| PT Bank vs. China Merchants Bank | PT Bank vs. HDFC Bank Limited | PT Bank vs. ICICI Bank Limited | PT Bank vs. PT Bank Central |
| FedEx vs. ANTA SPORTS PRODUCT | FedEx vs. SCIENCE IN SPORT | FedEx vs. ZINC MEDIA GR | FedEx vs. PT Global Mediacom |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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